| Job Description | An Internal Auditor is responsible for ensuring that a company’s operational and financial processes are running smoothly and legally. They examine and evaluate the organization’s financial and information systems, management procedures, and internal controls to ensure that records are accurate and controls are adequate. They also conduct risk assessments and audit reviews to ensure compliance with internal policies and regulatory requirements. |
| Skills | Attention to detail, Analytical skills, Communication skills, Problem-solving skills, Knowledge of auditing and accounting principles, Understanding of regulatory standards, Risk assessment skills, Proficiency in audit software |
| Industry | Finance, Banking, Insurance, Consulting, Government, Healthcare, Manufacturing |
| Experience Level | Mid-level to Senior |
| Education Requirements | A Bachelor’s degree in Accounting, Finance, Business or a related field. Many employers also prefer candidates who are Certified Public Accountants (CPAs) or Certified Internal Auditors (CIAs). |
| Work Environment | Internal Auditors typically work in an office setting during regular business hours. They may also be required to travel to different locations if the company has multiple branches. The job can be stressful, particularly when they have to meet tight deadlines or during an organization’s year-end. |
| Salary Range | $50,000 to $100,000 per year, depending on experience and location |
| Career Path | Internal Auditors often start their careers as Junior Auditors or Associate Auditors. With experience, they may progress to Senior Auditor, Audit Manager, and eventually to roles such as Director of Internal Audit. Some auditors may also transition into roles in finance or management. |
| Popular Companies | Deloitte, PricewaterhouseCoopers (PwC), Ernst & Young (EY), KPMG, Grant Thornton, BDO, RSM |
Internal Auditor Interview Questions
Can you describe a situation where you identified a significant risk to the business and how did you handle it?
How to Answer:
The interviewer wants to understand your risk assessment abilities and how you apply them in real-life situations. You should provide a specific example from your past experiences. Explain the situation, the risk you identified, your role in identifying that risk, the steps you took to mitigate the risk, and the outcome. It’s important to demonstrate your ability to take initiative and to communicate effectively.
Example:
In my previous role, I was conducting a routine internal audit when I noticed discrepancies in our financial reports. It indicated a significant risk of financial loss if not addressed promptly. I promptly informed our senior management about the issue. I then worked with the finance team to conduct a deeper analysis to identify the root cause. We found out that there was an error in our financial software that was causing the discrepancies. I coordinated with the IT team to correct the error and re-verified the financial reports. As a result, we were able to prevent a significant financial loss for our company.
How do you ensure compliance with policies and procedures during your audits?
How to Answer:
In answering this question, highlight your knowledge and understanding of internal audit standards and the steps you take to ensure compliance. You can discuss your approach to reviewing policies, your attention to detail, and your communication skills in advising stakeholders.
Example:
To ensure compliance during audits, I first thoroughly review the organization’s policies and procedures. I familiarize myself with all relevant details to ensure I understand what is expected of the organization and its employees. Then during the audit, I meticulously check whether these procedures are being followed. I also conduct interviews with employees to gain insights into their understanding of these policies and whether they are being enforced consistently. If I find any non-compliance, I document it in my audit report and advise the management on necessary steps to rectify the situation.
How would you handle a situation where a department head was resistant to your auditing process?
How to Answer:
The candidate should demonstrate their ability to handle resistance professionally, maintaining the integrity of the audit process. This involves explaining the importance of the audit, finding common ground, and escalating the issue if necessary.
Example:
In such a situation, I would first try to understand the reasons behind their resistance. Then, I would communicate the purpose and benefits of the audit in terms of risk management and process improvement. If they still remained resistant, I would involve my supervisor to ensure that the audit process is not compromised.
Can you describe a time when you used data analysis techniques during an audit to identify an inconsistency or discrepancy?
How to Answer:
When answering this question, highlight your analytical skills and your proficiency in using audit software or other data analysis tools. Describe the situation, the actions you took and the results of your actions. Be specific about the kinds of data you analyzed, the techniques you used, and how your analysis led to the discovery of an inconsistency or discrepancy.
Example:
During an audit at my previous company, I noticed an unusual pattern in the financial transactions of one department. Using data analysis techniques such as trend analysis and data matching in audit software, I identified several discrepancies in the expense reports. Upon further investigation, I discovered that these discrepancies were due to fraudulent activities by a staff member. After discussing my findings with senior management, they took swift action to address the issue. My analysis not only prevented further financial loss but also led to the implementation of more robust internal controls.
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How do you maintain your knowledge and skills as an Internal Auditor with the changing audit standards and regulations?
How to Answer:
The candidate should demonstrate their commitment to continuous learning, professional development, and staying updated with the latest industry changes. They could mention attending industry conferences, participating in webinars, enrolling in training programs, reading industry publications, and being a part of professional networks.
Example:
To stay updated with the changing audit standards and regulations, I regularly attend webinars and training provided by the Institute of Internal Auditors. I also subscribe to various audit industry publications and newsletters. I believe that being part of professional networks also helps to stay updated with the latest industry changes. For instance, I’m a member of the Association of Certified Fraud Examiners where I learn about the latest trends in fraud detection.
Can you describe a time when you had to present complex audit findings to non-auditors? How did you ensure your message was understood?
How to Answer:
When answering this question, it’s important to demonstrate your communication skills and your ability to explain complex information in a clear and understandable way. Discuss a specific instance where you had to present audit findings to individuals with little to no knowledge about auditing. Focus on the strategies you used to simplify the information and ensure it was comprehensible. It would be beneficial to mention any positive feedback or successful outcomes that resulted from your presentation.
Example:
In my previous role as an Internal Auditor at XYZ Corporation, I had to present the audit findings of a complex financial system to the marketing team. I knew they had little understanding of the auditing process or the technicalities involved, so I broke down the information into simple, relatable terms. I used analogies related to their field of work to explain the discrepancies we found and the potential impact on the business. I also prepared visual aids to support my explanation. After the presentation, I received positive feedback from the team and the department head, acknowledging that they understood the findings and the measures needed to rectify the issues. This led to an effective resolution of the discrepancies and improved cross-departmental understanding of the audit process.
Can you describe a situation where you had to deal with a difficult stakeholder during an audit process?
How to Answer:
The interviewer is trying to understand how you handle conflict and difficult situations. They want to know if you have the ability to navigate through challenging scenarios while still maintaining professionalism and effectiveness as an auditor. When answering this question, describe the situation, explain the actions you took to resolve the issue and highlight the positive outcome. It’s important to demonstrate your problem-solving skills, communication abilities and your capacity to manage relationships.
Example:
In my previous role, there was an instance where a senior manager was not cooperative during an audit process. He was resistant to provide necessary documents and information. Initially, I tried to explain the importance and necessity of the audit, however, the problem persisted. I then decided to escalate the issue to my senior. I provided him with a detailed report on the situation and the risk it posed. He then had a discussion with the senior manager and explained the importance of the audit. As a result, the senior manager cooperated and we were able to complete the audit successfully. This situation taught me the importance of clear communication and timely escalation.
Can you describe a time when you had to perform an audit under a tight deadline? How did you ensure the quality of your work?
How to Answer:
When answering this question, the interviewer wants to know how you handle pressure and tight deadlines. Describe a time when you had to work under a tight schedule. Show how you prioritized your work, remained organized, and how you ensured the quality of your work despite the time constraint. Lastly, explain the outcome and what you learned from the experience.
Example:
At my previous job, there was an instance where we had to complete an audit within a week due to an upcoming board meeting. It was a challenging task, but I broke down the work into manageable tasks, prioritized them, and created a detailed schedule. Despite the tight deadline, I ensured that I did not compromise on the quality of my work. I double-checked all my findings and cross-verified the data to avoid any errors. We managed to complete the audit on time, and there were no significant issues found later. This experience taught me the importance of staying organized and maintaining a keen eye for detail even when working under pressure.
What steps do you take to ensure confidentiality and data protection during your audit process?
How to Answer:
In your response, emphasize your understanding of the importance of confidentiality and data protection in the audit process. Describe the steps you take to ensure these, such as following the company’s confidentiality policy, using secure data storage systems, or implementing a clear data access protocol. You can also mention how you handle sensitive information during communication with stakeholders.
Example:
Understanding the importance of confidentiality and data protection in auditing, I always adhere to the company’s confidentiality policy and guidelines. I ensure that all data used during the audit process is stored in secure systems with restricted access. I also implement a clear protocol on who has access to what information. During communication with stakeholders, I make sure to only disclose the necessary information and avoid discussing sensitive data in public or non-secure channels.
What strategies do you employ to maintain objectivity and avoid bias during your audits?
How to Answer:
The candidate should demonstrate an understanding of the importance of objectivity in internal audit and should provide strategies they use to avoid bias. These could include maintaining professional skepticism, ensuring independence in the audit process, using a systematic approach, basing audit conclusions on evidence and not personal opinions, consulting with colleagues or superiors to get a different perspective, and continuous training to recognize and avoid potential bias.
Example:
Maintaining objectivity and avoiding bias is crucial in my role as an Internal Auditor. I always ensure professional skepticism in my work. I do not let personal relationships or prejudices cloud my judgement. Also, I base my conclusions on audit evidence and not personal opinions. I use a systematic approach in my audit process to ensure that I cover all areas without favoritism. In situations where I feel there might be a potential bias, I consult with my colleagues or superiors to get a different perspective. Additionally, I continuously educate myself through training and professional development to understand and avoid potential bias in my work.
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